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Call for business and government to accelerate switch to electric fleets

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Transforming fleets is the key to accelerating take-up of electric vehicles (EVs) and increasing the size of the used EV market, according to a global report from international non-profit the Climate Group.

The analysis, which was carried out in partnership with sustainability consultancy SYSTEMIQ, indicated businesses and governments can grow used EV market by 40% in 2030 by transforming fleets.

Buses and light duty fleet vehicles currently account for a fifth (21%) of vehicles on the road, yet contribute to a quarter (26%) of road transport emissions. The report states that at present, fleet vehicles are being left behind in the electrification race as the majority of EVs driven today are privately owned passenger vehicles, while just 11% are part of fleets.

Helen Clarkson, CEO, Climate Group, said: “Businesses, governments and public sector organisations have about half a billion light duty vehicles in their fleets around the world. By switching these vehicles to electric, these organisations can use their purchasing power to drive us to a better future.

“Not only can fleets electrify faster, but crucially it would help to bring about a wider shift to clean road transport by supercharging demand, boosting infrastructure and growing the used EV market, making them more readily available and affordable for consumers. As we head towards COP26, we need the right commitments, policy support and investment to make faster fleet electrification a reality.”

The research modelling suggests that if the vast majority of new bus and light duty fleet vehicle sales are EVs by 2030, the used car market for EVs would be around 40% larger in 2030 and over 70% larger in 2040. This would mean an extra 7.2 million second-hand EVs on the market in 2030.

The report also argues that as the accelerated scenario would mean greater EV demand, this would lead to battery costs being a further 14% cheaper by 2030 than has been forecast, thanks to advances in the efficiency of production. This would help to bring forward the tipping point where EVs reach purchase price parity with equivalent internal combustion engine (ICE) vehicles by around one year, with this occurring as early as 2023 in some markets and vehicle categories.

In addition, meeting charging demand under this accelerated scenario would on average require an extra 14,000 charging units to be installed every day through to 2030, over and above current projections. This means that faster fleet electrification would result in an additional four million public chargers being built – enough to meet the needs of 29 million EVs.

In order for this accelerated change to happen, Climate Group is calling for businesses and governments that own and operate vehicles to commit to EVs today, sending a demand signal to help trigger investments in increased production capacity from automotive manufacturers and within the battery value chain.

Its campaign, EV100, has seen over 100 corporates with some of the world’s largest fleets, including BT Group, LeasePlan and Siemens, committed to transition more than five million light duty vehicles to electric by 2030.

Fleets First: How accelerating fleet electrification can unlock the shift to clean road transport